AEC Labs’ summer 2018 construction tech news roundup and analysis

Labor Day is here! How did that happen?!? I underestimated how disruptive the summer would be to our routine – small children are not for the faint of heart! But overall we’ve had a pretty good summer, despite the terrible weather on the East Coast. I hope you got to enjoy some down time, too.

The price of all that summer fun has been a very quiet couple of months here at AEC Labs. But that doesn’t mean things in the construction tech space have been quiet; far from it. From funding to acquisitions to new technologies, this summer has seen quite a bit of action in the contech space.

So, in order to catch you (and ourselves!) up on everything that’s been happening, here’s a roundup post of articles and news we’ve flagged and found interesting over the past couple of months, with some commentary where appropriate.

Let us know in the comments if we’ve missed anything! We’ll get back on our regular posting schedule after Labor Day. And, as always, thanks for reading!

BuildingConnected acquires TradeTapp. NYC-based TradeTapp was one of the first construction tech startups we wrote about here at AEC Labs way back in 2016. Congrats to TradeTapp founder Justin Levineon the deal! It’s now part ofBuildingConnected, a preconstruction platform that helps real estate owners and general contractors hire subs. The company says more than $100 billion in new construction projects are bid out across its network every month, and more than 200,000 owners, general contractors, and subcontracting companies use the platform monthly. TradeTapp is a web-based prequalification platform for subcontractors, and this deal seems to have great synergies for both sides. We’ll be keeping an eye on the combined company this fall and into 2019.

Microsoft partnered with an African real estate developer to work on blockchain applications for the construction industry. Not much detail in this article about the partnership, but definitely worth keeping tabs on. There is lots of stuff happening right now at the intersection of blockchain and construction, but so far it’s mostly been overseas. Blockchain solutions that help improve trust and transparency for construction stakeholders – particularly in dodgy locations – will find lots of interest. But in my view the holy grail for a blockchain application in the construction industry will be if it can help bridge the $4.5T in funding that U.S. infrastructure will need by 2025. More on this, soon, here at AEC Labs.

Software giant Autodesk invested $8M in Rhumbix, another software platform which helps contractors go paperless in the field. Autodesk provides project management software solutions, so this is clearly a play to connect back office operations with what’s happening in the field.

The prefab housing startup Module received a permit from Pittsburgh to construct/install its first home in the city. We’ve written about Module previously here at AEC Labs.

PlanGrid and FMI surveyed 600 construction industry leaders, who revealed that $200B in annual labor costs are spent fixing avoidable mistakes and performing rework. Software, AI, and construction tech generally is taking aim at solving this inefficiency, but the persistent lack of human workers is taking a toll on the industry, and it appears to only be getting worse. Can tech close this gap or is the industry doomed? Only time will tell, but there is clearly a huge opportunity here for startups with good ideas and ambition.

3D printing for construction projects is here, but so are new legal implications. ENR took a look at the legal aspects of 3D printing for construction; questions about liability, warranties, licensing and ethics, and much more are still very much open. It’s great to “move fast and break things,” but across the board, legal considerations for new technology in construction should always be vetted carefully.

Private fundraising for infrastructure investment continued at a brisk pace, but the lack of a federal infrastructure plan seems to be dragging down deal flow. This is despite remarks from USDOT Transportation Secretary Elaine Chao at the annual Fortune magazine Brainstorm Tech conference in Colorado that the Trump administration still “hopes to do something big on infrastructure.”

The well-funded, design-build startup Katerra acquired Vancouver-based timber design firm Michael Green Architecture. The company was already constructing a cross-laminated timber manufacturing facility in Spokane, Washington; using timber as a structural member is part of its strategy to drop construction costs by 30 percent over a conventional developer. Katerra also announced plans for another plant in California, flush with its nearly $900M in funding from SoftBank that closed earlier this year.

Skender, another startup trying to integrate design and construction into a one-stop manufacturing process, opened a modular factory in Chicago. Vertical integration and integrated delivery is the rage right now across the industry, from increased emphasis on design-build and alternative delivery models, to startups like Katerra and Skender that are trying to apply manufacturing principles to design and construction. Whether these types of companies and technologies can lead to improvements in sectors of the industry that don’t lend themselves to modular construction (like infrastructure) will be a challenge, but perhaps an opportunity to apply Lean, Six Sigma, and other processes with origins outside of the industry more broadly.

Blockchain applications for the AEC industry continued to push their way into the mainstream, with ENR reporting on the industry’s first-ever “digital twin” of a construction project’s documentation. Produced by the startup Brickschain for a project in Minnesota, the company’s software has the potential to create an immutable ledger of every document produced on a project, which could have significant implications for discovery, dispute resolution, and insurance if implemented broadly.

The construction tech accelerator URBAN-X picked seven startups from 400 applications to join its fourth group of companies that are rethinking urban living. Startups of interest in the construction tech space included Avvir, which provides construction project monitoring that automates data acquisition, and ClearRoad, a toll road pricing software product that helps governments set tolls without costly, proprietary hardware. The program is backed by BMW and URBAN-X is based in Brooklyn.

“AI for infrastructure” startup SenSat nabs $4.5M in seed funding round. The UK-based company will use the funds to build out its office in San Francisco. Its software uses open-source and proprietary visual and spatial data sets to build virtual models of real-world locations, against which an AI algorithm can run various kinds of simulations and optimize design solutions (like the layout for a new railroad or the amount of quantities necessary to construct a roadway). I think SenSat’s technology is something to keep an eye on; particularly on large infrastructure, the design can cost nearly 40% of the total spend, and errors in the alignment, or quantities can cause everyone a lot of headaches (in the form of time and dollars).

AECOM and the software provider Bluebeam announced a partnership in conjunction with the California Division of the State Architect. The firms are aiming to fully digitize the DSA’s design review process by the end of the calendar year. DSA reviews approximately 4,000 projects worth $6B in construction spend annually.

About The Author

Stephen Del Percio is the founder of AEC Labs. He's a civil engineer by training with nearly two decades of experience in the trenches of the construction industry, both as a project manager and an attorney. Stephen also took a two-year sabbatical from the industry inside Amazon.com, an experience which sparked his interested in how tech could be applied to, and ultimately improve, the AEC industry. You can find him on social media below or send him an email to connect!